Innovation Is Back, Says Accenture—Or Is it?

Posted by: Michael Arndt on November 11, 2009

Nearly two years after the U.S. tumbled into a recession, business is starting to think about ways to grow again. And for many, this means spending more money on innovation, says a new study from Accenture. In a survey of 630 execs in the U.S. and the U.K., 48% said their companies had upped their innovation budgets from six months ago. A third said innovation outlays were flat.

There’s a gray lining in these numbers: One in every five companies is still cutting spending on the development of new products or services.

And there are other findings that suggest that companies really haven’t kicked their recession habits. While new products or services have the biggest potential to generate sales and profit, 74% of the respondents told Accenture that their companies were pursuing incremental advances, like line extensions. (How many varieties of Coca-Cola will we really drink?) Along the same lines, 66% said their companies were more interested in short-term gains than long-term ones. (Same question.)

In the U.S., at least, companies may not be getting better at innovation, either. Accenture said 73% of American respondents said their employers didn’t learn from mistakes. (In the U.K., only 30% were such slow learners.) Respondents blamed failed innovation mostly on inability to meet customer needs, being late to market, and incorrect pricing.

What’s going on at your companies? Are you seeing any lift in innovation allocations?

Reader Comments

George

November 12, 2009 11:29 PM

From our standpoint, there seems to be an uptick in organizations investigating the use of idea management software. The main benefit of better systems available on the market is their ability to link organizations with suppliers and customers on an idea sharing platform. These systems virtually guarantee that opportunities for innovative products and services can be identified in a timely manner.

To learn more about our system and others you can go to:

www.incentsolutions.com

Sarah Merion

November 16, 2009 1:20 PM

Innovation value chain is a huge issue. I actually am not seeing this terribly much in the "social media" space, and I attribute it to lots of regurgitation of information and business models. As the social media bubble begins to burst though, I'm sure we will see much more innovation and a shift towards a regained interest in consumer needs. There's a related article about where innovation happens here: http://ow.ly/COjZ

Andrew McFarland

November 16, 2009 9:06 PM

One safe place to invest (always) is in your customers' success.

Now is the time to win market share!

http://pivotpointsolutions.net/2009/10/24/with-all-this-global-warming-why-is-my-company-frozen/

Mariano di Palma

November 18, 2009 3:00 PM

Hi! very interesting thoughts about Innovation. You know, from our Lab we try everyday to go beyond traditional business perspectives and share with our clients how through brands we can really create true and sustainable human value to people. We think this is the key factor to get innovation philosophy to work.
We as brands, have a social role that is to engage emotionally with people's hearts to let them live their dreams to trascend life. Is there anything more important and valuable for us in life?

Our true work is to let people stay close from what they dream to express their self through our products and brands. Because products are simply carriers of true human value. Energizing people's lives though brands is the real job of the innovation business philosophy.

Because effective innovation is about emotional engagement. It's about shaping and building immersive liveable brands that let people shine on and trascend life in unique ways. That's the true business and social purpose of innovation in society. This is our true social legacy as a business.

To discover how to engage emotionally with people through products and brands, just play:

www.umania.com.ar

UmäniaLAB Communications
Be welcome

David Goudge

November 28, 2009 11:24 AM

As a UK based innovation consultancy we have certainly seen an increase in the number of major FMCG clients comissioning innovation strategy and pipeline-filling projects over the last two months. www.brand-development.com

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